All Forum Posts by: Josh Alexander

Hey, live here in OC. So a few things, with OC and most places, SFR will always appreciate faster than condos and there are less regulations and rules to worry about as well so in terms of leverage in the long term and property management SFRs are the way to go. However, I also understand that the price difference as well as the down payment required to get the property to eventually cash flow are going to be significantly higher with an SFR and it really doesn't make sense in a lot of cases in OC. Yes, there are deals out there, but they will be harder to come by in OC and whether you go with condo or SFR, you'll definitely want run the numbers carefully especially if you don't have a significant down payment. Another option if you want to invest close to home, depending on your flexibility, would be to look slightly outside OC in areas of Corona or even Murrieta where it makes more sense in terms of cash flow because you can get an SFR there for the same price as a condo in OC and that area is still growing due to LA and OC buying homes out there now because of the work from home trend.

Glad you were able to get some extra credits on the sale! Like I said previously the market is slowing down so sellers are not able to be as picky as they were just a few months ago with offers and repair requests. Congrats! 

Hey Brock you can try Gio from ML Home Home Innovations. Not sure what their timelines look like right now but they work in our area and prices are reasonable. His number is 714-427-5116.

As long as vacancy rates stay at all time lows in OC( I believe they are hovering around 2.4% right now) then you can expect rental costs to rise at a pretty quick pace over the next year or two. However you do want to be carful on the appreciation side of things. The market is in the middle of a transition period where it's really hard to expect double digit appreciation in OC going forward. If interest rates stay around where they are I would expect appreciation to slow down closer to the average of 3-4% a year. I have been seeing homes that would have received 10-15 offers a few months ago "only" get about 2-6 right now, price reduction are on the rise(they have gone from about 15% to 20% in the last few weeks in OC) and the number of escrow dropping out have been higher as well. I don't see prices coming down anytime soon yet but the market is definitely slowing down to a healthier pace. It sounds like you are ok losing money for the first few years with the anticipation of breaking even later and eventually cash flowing so as long as that fits into your long term strategy and you're not going to be forced to sell it in a few years it could still end up being a great investment in 5-10 years from now, however there are other markets around OC that also might be worth looking into, like the Riverside area where prices are still lower and rent is going up just as fast. This might get you to cash flow a few years faster.  As far as the A/C goes depending on how you run your rentals, remember in CA that if you replace the blower, in order to stay code compliant you are also required to replace all of the ducting if it's older as well. Does everyone do this, definitely not, but just throwing it out there in case you weren't aware. Hope this helps. 

Depends on a lot of factors but if you are looking to invest close to the same area it might make more sense to look at opportunities in SFRs that don't have an HOA or a duplex and buying somewhere that is likely to appreciate at a faster rate than OC. Maybe check out SFR in the Corona/Murrieta area. You'll probably get a better return and you can get well maintained SFRs in the 600,000s there or find a fixer opportunity for some forced equity for less than that. If you are looking just for CF and want the same area might look into the possibility of short term rentals in the Big Bear/Arrowhead or Joshua Tree area as well.

Here is the investor meet up that I go to. They meet once a month. Still virtual right now but will go back to in person soon. https://www.meetup.com/NOCREI/

Can you send me some details? I have some buyers who are looking in that area right now. 

Lots of options in So Cal for these types of investments, I would say the first thing you want to do is to start narrowing down what type of investment you want to make first and how much time you want to allocate to your investments. For example short term rentals are good for immediate cash flow but unless you want to outsource it and pay really high management fees, managing short term rentals will typically take more of your time every week. If you want to buy and hold then it requires less day to day work but less cash flow up front. The multifamily properties are great if you want to house hack but tend to cost more up front so if you aren't living in them, at least if your investing in most areas of So Cal, you'll need a fairly large downpayment to snatch one of those up.  Once you figure out what type of investment you want to start out with them you can start creating the set of criteria that works for you which will allow you to start narrowing down the areas you might be interested in.  The more you can narrow down your niche, the easier it will be to become well versed in one area and that will ultimately make it easier to make a smart investment.

Is it your first home? Usually as long as you plan on living in one of the units you can put as little as 3% down. However to keep the mortgage payments reasonable in those two higher cost areas I would probably recommend saving up more than that if you want to be able to break even or cash flow a little.